Residents of Leeds, Manchester and Preston are drowning in a sea of personal debt and owe more loans per person than anywhere else in Britain, according to a study by major financial lenders.

The illuminating research carried out for the first time by the British Bankers Association and the Council of Mortgage Lenders showed people and businesses across the country rely on a staggering £1trillion worth of lending.

It also showed shocking levels of borrowing, with many people relying on loans and other types of credit to make ends meet.

Stressed out: People are taking out increasing levels of loans to cope with their bills, say lenders

People living in the Leeds postal sector of LS17 0, which includes Harewood and Moortown, owe an average of £1,516 in personal loans per head, which was the highest figure found for this type of debt.

Meanwhile residents in the postcode area of M3 3 in Manchester, which takes in Sale and Trafford, had the second highest level of personal loan debt per person at £1,408 on average.

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Those living in PR7 7 in Preston have the third largest debts owing £1,270 per head.

Postcodes in Chester, Swansea and Hull also featured highly in terms of how much people owe per person on their personal loan debt, while Milton Keynes appeared twice on the top 10 list.

TOP TEN POSTCODES THAT OWE THE HIGHEST AMOUNT IN PERSONAL LOANS

1. LS17 0 Leeds, £1,516

2. M3 3, Manchester, £1,408

3. PR7 7, Preston, £1,270

4. CH47 0, Chester, £1,238

5. SA7 0, Swansea, £1,222

6. HU1 3, Hull, £1,214

7. MK9 4, Milton Keynes, £1,205

8. TD12 4, Galashiels, £1,204

9. MK42 6, Milton Keynes, £1,182

10. NE13 9, Newcastle upon Tyne, £1,156

However, despite people in the North
borrowing the most according to the figures, Londoners are deep in debt
too, accounting for one quarter of the total of the country’s mortgage
debt.

The London
postcode with the highest level of mortgage debt is SW11 6, covering
Clapham and Battersea in south London, where households owed
£649million.

This was
followed by E14 9, which covers areas of Tower Hamlets and Canary Wharf,
where families owe £629million on their mortgages.

Fears have been raised in recent months that the housing market in London is overheating.

Latest figures from the Office for National Statistics house prices in the English capital surged by 12 per cent year-on-year to £437,000. A house in London now typically costs almost three times one in the North East.

CML director general Paul Smee said: ‘As you would expect, strong levels of mortgage lending are broadly correlated with those areas where there is a strong resident population.’

However, one area
appeared to show restraint over the level of mortgage debt they had -
and that was those in the North East.

The
report suggests that residents there have the lowest level of
outstanding mortgage debt which accounts for £25billion worth of the
total.

REGIONS WITH THE HIGHEST LEVEL OF OUTSTANDING MORTGAGE DEBT

Britain £891.4 billion

London, £227.3billion

South East, £161.4billion

North West, £80.9billion

South West, £79.3billion

Scotland, £63.8billion

West Midlands, £61.6billion

East of England, £60.3billion

Yorkshire and the Humber £57.8billion

East Midlands, £44.5billion

Wales, £28.5billion

North East, £25.9billion

Meanwhile, the BBA said the findings showed that many areas outside London and the South East receive a bigger chunk of small business lending proportionately than those within these regions.

For example, while London accounts for an estimated 29 per cent of Britain's small and medium-sized business turnover, but only 21 per cent of lending to SMEs goes to the English capital.

In other parts of the United Kingdom, Scotland accounted for eight per cent of Britain's SME lending but six per cent of the country's estimated SME turnover.

Elsewhere, Wales accounted for five per cent of the country's SME lending but three per cent of its estimated turnover.

The ground breaking research was conducted by combining lending data with population records, and reviewed people's spending habits in over 9,000 postcodes - but not all of Britain's lenders took part.

BBA chief executive Anthony Browne said the drive to publish the figures ‘makes the British financial services industry significantly more transparent’.

He said: ‘Lenders are supplying vital funding to SMEs across the country - proportionately, they are lending more to businesses across Britain than to those in London and the South East.’

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